by Leslie Small
In the ongoing effort to
curb rising drug costs, several states have introduced legislation that would
create “drug affordability review boards” tasked with establishing a maximum
amount that insurers would pay for drugs when prices rise above a set threshold.
In the eyes of the
consultant who is helping states develop such measures, this approach to
lowering drug costs will only benefit health insurers.
“The point is absolutely
to help payers, and then they can help their enrollees” afford their prescription
drugs, says Jane Horvath, a health care policy consultant and former senior
policy fellow at the National Academy for State Health Policy (NASHP), which
developed model legislation that the state bills are based on.
According to Horvath, the
states’ bills all follow a similar formula: A board composed of five members
first collects input from the public and health plans about drugs that appear
to be “stressing the system,” such as new brand-name drugs with a wholesale
acquisition cost of $30,000 or more per year.
Using the example of a
new, pricey oncology drug with fewer side effects than an existing therapy,
Horvath explains that the board then might ask health plans in the state about
the net cost for the drug that the new medication is superseding. “What the
health plan used to spend on the prior product maybe becomes the de facto
affordability point,” she says.
For its part, America’s
Health Insurance Plans (AHIP) appears somewhat supportive of the concept.
“Drug review boards at
the state level can help drive transparency in how drug prices are set and why
those prices are going up,” AHIP spokesperson Kristine Grow said in a statement
to AIS Health. “We believe that information should then be used to find ways to
increase competition and introduce new levers to negotiate lower prices.”
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